07:27 AM EST, 11/05/2026 (MT Newswires) -- The Bank of England on Thursday increased its key rate by 25 basis points to 4% as it noted the need to guard against second-round effects amid higher inflationary risks due to the continued war in the Middle East. The decision is in line with the consensus estimate for the month. The BoE's Monetary Policy Committee voted 8-1 in favor of a hike, with one member voting to increase the bank rate by 50 basis points to 4.25%. The MPC said the risk of stronger inflationary pressure is now higher, compared with that during its previous meeting, as energy prices continue to rise due to the conflict. It will also continue to closely monitor the relevant indicators of potential second-round effects. Based on the latest government data, the UK's annual inflation rate rose to 3.5% in September from the previous month's 3.1%, with the core rate edging up to 2.8% from 2.6%. The BoE's medium-term inflation target stands at 2%.

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